In one more occasion of the federal government coming down laborious on Chinese corporations, the Enforcement Directorate (ED) on Tuesday performed searches at 44 locations throughout the nation in a cash laundering investigation towards smartphone producer Vivo and associated corporations.
After the Indo-China border tensions in mid-2020, the federal government has been taking a tricky stance towards Chinese investments. It banned greater than 300 Chinese apps the identical yr and barred distributors from nations sharing land border with India from bidding for any public initiatives with out its prior approval.
Subsequently, Chinese telecom handset corporations and kit producers have been subjected to searches by ED and the earnings tax division for alleged violation of economic legal guidelines. Sources stated that the searches at Vivo are being carried out below sections of the Prevention of Money Laundering Act (PMLA) at areas in a number of states together with in Delhi, Uttar Pradesh, Meghalaya, Maharashtra and others.
A Vivo India spokesperson stated they’re cooperating with authorities. “Vivo is cooperating with the authorities to provide them with all required information. As a responsible corporate, we are committed to be fully compliant with laws,” the spokesperson stated.
The ED filed a cash laundering case after taking cognisance of a latest Delhi Police (EOW) FIR towards a distributor of the company based mostly in Jammu and Kashmir the place it was alleged that few Chinese shareholders in that firm solid their determine paperwork.
The ED suspects this alleged forgery was finished to launder illegally generated funds utilizing shell or paper corporations and a few of these “proceeds of crime” have been diverted overseas or put in another companies by skirting Indian tax and enforcement companies.
In April, ED had ordered seizure of Rs 5,551 crore price deposits of Chinese smartphone main Xiaomi India for alleged contravention of the Foreign Exchange Management Act (FEMA). Later, Xiaomi obtained an interim reduction order from the Karnataka excessive courtroom.
Earlier in February, the earnings tax division had raided Chinese telecom tools manufacturing firm Huawei claiming to have discovered alleged manipulation of account books for decreasing taxable earnings in India by the agency.
Premises of a lot of Chinese smartphone corporations, together with Xiaomi, Oppo and Vivo, their distributors and linked associates have been raided throughout the nation by the IT division in December final yr and it later claimed to have detected alleged unaccounted earnings price over Rs 6,500 crore on account of violation of the Indian tax legislation and laws.
Vivo had 15% market share within the Indian smartphone section within the first quarter of calendar 2022 with cargo of 5.5 million gadgets, based on market analysis and evaluation agency IDC.
According to a Counterpoint analysis report, Vivo grew to become the highest 5G model within the Rs 10,000-20,000 worth section within the nation throughout March 2022 quarter.
Source: www.financialexpress.com”